T-Bills Remain In The Red For The Third Week Running

T-Bills remained in the red for the third week running according to the weekly report released by Cytonn Investments.

Last week, T-Bills remained undersubscribed with analysts saying they are unlikely to pass the 100 percent mark as the month nears the end.

The subscription rate for T-Bills during the week came in at 80.6 percent, down from 98.3 percent recorded the previous week.

According to Cytonn Investments, the decline in T-Bills subscription was as a result of the relatively tight liquidity conditions in the money markets during the week.

The relatively tight liquidity in the money markets during the week has been attributed to the cyclical liquidity tightness due to the start of the new CRR cycle.

The yield on the 91-day and 364-day papers remained unchanged at 6.4 and 9.8 percent respectively.

The yield on the 182-day paper, on the other hand, fell by 0.1 percentage points to 7.2 percent from 7.3 percent that was recorded the previous week.

The acceptance rate for the T-Bills last week stood at 67.8 percent, a drop from 71.7 percent that was recorded the previous week.

The government of Kenya accepted 13.1 billion shillings out if the 19.3 billion shillings worth of bids received.

In the money markets, 3-month bank placements ended the week at 8.6 percent. This is based on the rates offered by various banks to Cytonn Investments.

The 91-day T-Bill came in at 6.4 percent. The average of top 5 Money Market Funds came in at 10.1 percent, higher than the 10.0 percent that was recorded the previous week.

Cytonn Money Market Fund closed the week at 11.0 percent from 10.9 percent recorded the previous week.

NOTE: T-Bills are said to have been oversubscribed when the subscription rate is above 100 percent. They are said to have been undersubscribed when the subscription rate is below 100 percent.

Most traders in Treasury Bills are Kenyan commercial banks who prefer trading with the government than individuals because the bonds have high security and high returns.